# In the matter of Air Costa Aviation Private limited CP (IB) No. 93-9-HDB-2018

> NCLT judgment dated 2019-07-23. Citation: TCN-2019-NCLT-02348. M/s. Easy Trip Planners Private Limited filed a petition against M/s. Air Costa Aviation…

- **Court:** NCLT
- **Order date:** 23 Jul 2019
- **Citation:** TCN-2019-NCLT-02348
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-chandigarh/air-costa-aviation-private-limited-cp-ib-no-93-9-hdb-2018-b1cdeef3

## Summary

### Background

M/s. Easy Trip Planners Private Limited filed a petition against M/s. Air Costa Aviation Private Limited, alleging a default in repaying a sum of Rs. 3,05,74,995/-, which includes a principal loan amount of Rs. 2,52,68,591/- and interest of Rs. 53,06,404/-. The petition was filed under Section 9 of the Insolvency and Bankruptcy Code, 2016, seeking initiation of the Corporate Insolvency Resolution Process (CIRP), a moratorium, and the appointment of an Interim Resolution Professional (IRP). The Operational Creditor and Corporate Debtor presented their arguments and evidence.

## Facts

Easy Trip Planners Private Limited (Operational Creditor) filed a petition against Air Costa Aviation Private Limited (Corporate Debtor) under Section 9 of the IBC, 2016, claiming a default of Rs. 3,05,74,995/-. The Operational Creditor alleged that Air Costa defaulted on payments related to an API agreement for providing travel flight services. The Corporate Debtor argued that the API agreement was with LEPL Projects Limited, not Air Costa Aviation, and that the demand notice was not properly served. The Operational Creditor contended that Air Costa and LEPL Projects Limited are effectively the same entity. A settlement deed was executed during the pendency of the petition, with a partial payment made. The Corporate Debtor's registered office is in Hyderabad,

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## Issues and analysis

### Issue 1: Whether the petition filed by the Operational Creditor is maintainable against the Corporate …

**Ratio:** A corporate debtor can only be held liable for debts arising from agreements to which it

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**Reasoning:** The court reasoned that the API agreement was between the Operational Creditor and LEPL

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**Interpretation:** This highlights the fundamental principle of contract law that a party can only

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**Application:** The court applied this principle to the facts by noting that the API agreement,

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## Parties

- **Judges:** Ratakonda…
- **Appellants:** M/s. Easy Trip…
- **Respondents:** M/s. Air Costa…

## Timeline

- **2013-06-25 — API Agre…**: The Corporate Debtor allegedly entered into an API Agreement with the Operational…
- **2017-02-10 — Payment by Operational…**: The Operational Creditor made a payment of…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 9 — Application for initiation of corporate insolvency…](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-9)

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